CCIR publishes issues paper on electronic proof of auto insurance

The Canadian Council of Insurance Regulators (CCIR) announced on Monday that it has published an issues paper for public consultation on electronic proof of automobile insurance (EPAI).

As electronic documentation becomes more prevalent in society – be it through smart phone apps, emails, or other forms of electronic documents – many consumers and insurers would like these options to be available in the auto insurance market, the CCIR said in a release. As a result, CCIR’s Electronic Commerce Committee (ECC) is coordinating efforts to introduce the option of the EPAI in Canada as an alternative to the current paper cards.

After conducting a thorough review of the issues, potential concerns and the legal and regulatory requirements within each province and territory to allow for the use of EPAI, the CCIR is releasing for public consultation its findings and recommendations in its Electronic Proof of Automobile Insurance Issues Paper.

The consultation period for this issues paper will be 45 days. The deadline to provide written submissions is June 30.

The CCIR said in the issues paper that the ECC believes that Canadian insurance regulators “have the legal capacity to authorize EPAI delivery and use within their respective jurisdiction, without the need to make changes to the current legislation,” which can be accomplished through the issuance of notice statements or bulletins in each province and territory.

“In order to insure a coordinated approach is taken in authorizing the use of EPAI in all Canadian jurisdictions, it is suggested that regulators take such action within an agreed timeframe,” the paper said. “However, allowing for the use of EPAI by insurance regulators may require some legislative amendments in other areas, specifically as it relates to operational concerns regarding privacy and liability issues. Such concerns need to be identified and fully explored with stakeholders in order to understand the impacts and the required changes that need to be put in place in support of EPAI.”

Some of the concerns identified in the paper include the following questions:

• Will law enforcement be allowed to access other information/content on electronic devices used to demonstrate proof of insurance?
• If law enforcement questions the validity of EPAI, are they allowed to confiscate the electronic device?
• Who is responsible if electronic devices used to demonstrate proof of insurance, such as mobile device, are damaged during inspection?
• What is considered “reasonable inspection” for law enforcement handling electronic devices?
• When travelling to a jurisdiction that does not yet allow for the EPAI, what steps must be taken?
• If an electronic device malfunctions, has no network access or is out of power, how will law enforcement handle such issues?
• If the owner on a vehicle gives permission to third party to use their vehicle, how does electronic proof of insurance work in such cases?
• While photocopies of proof of insurance are not permissible, will insureds be allowed to print paper copies of proof of insurance cards emailed to them by their insurer?
• Will electronic proof of insurance apply to all classes of vehicles? and
• What kind of safeguards should be in place to prevent the fraudulent use of electronic proof of insurance?

In addition to the public consultation on this issues paper, members of the ECC will be engaging various stakeholder groups to discuss the project and begin coordinating efforts to operationalize the EPAI in Canada.

The CCIR encourages all interested parties to review and comment on the respective papers. Electronic submissions would be preferred via the CCIR Secretariat email: ccir-ccrra@fsco.gov.on.ca. Written submissions should be forwarded to: CCIR Secretariat, 5160 Yonge Street, Box 85, Toronto, Ontario, M2N 6L9.

The CCIR intends to publicly release all submissions received pursuant to this consultation process by posting them on their website, unless otherwise requested.